Blue Cross to merge offices, build in Quincy

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Bill Archambeault

Journal Staff

Blue Cross and Blue Shield of Massachusetts is consolidating its South Shore operations with plans to build a new, 300,000- to 400,000-square-foot office building in Hingham and to renovate a 320,000-square-foot building in Quincy.

Blue Cross, the state's largest HMO, plans to use environmentally friendly "green" designs in both buildings, which will consolidate some 2,500 employees from four locations into the two new locations. Blue Cross leases space at 100 Newport Ave.; 25 Newport Ave. and 100 Hancock St. in Quincy; and 1022 Hingham St. in Rockland.

Its current leases are either expiring or being terminated, which will allow the HMO to consolidate into the two buildings, said Larry Healey, director of real estate and planning for Blue Cross.

"We want to own and control our own destiny," Healey said. "This gives us maximum control and a great deal of flexibility."

Boston-based A.W. Perry Inc. sold the Hingham property to Blue Cross for an undisclosed sum and is developing the site, which will house 1,300 employees for Blue Cross. Three Enterprise Drive in Quincy, which Blue Cross bought from State Street Corp., will house 1,200 employees. Blue Cross expects to occupy that building around the middle of 2005.

Blue Cross looked at buying existing buildings on the South Shore, but could not find anything it wanted that was large enough. The company also decided not to build a single, massive building on the South Shore, believing that employee commutes, operational efficiency and disaster recovery all worked better in two, large buildings.

"There's nothing down there large enough," Healey said. "We looked at some other options, but this gives us the best geographic location with some expandability."

Aside from some smaller satellite offices, the Hingham and Quincy buildings will be Blue Cross' major locations besides the company's headquarters at the Landmark Center, 401 Park Drive, in Boston, where 1,500 employees work.

The building proposed in Hingham is located on 35 acres next to South Shore Technology Park, a 230-acre site at Exit 14 on Route 3 that A.W. Perry is developing. Serono SA's North American headquarters was the park's first tenant.

Although the Blue Cross parcel is not technically within the boundaries of South Shore Technology Park, the park may be expanded to include it, said Tom Teuten, president of A.W. Perry. "We would love to do that, to find more Blue Crosses," he said. "We can accommodate some large users."

While the South Shore has never been known as a strong office market, Teuten said A.W. Perry sees potential for the site, especially given the talent pool in the area.

"We've been down in this neck of the woods a number of years," he said. "It has a lot of things going for it. The South Shore towns are very livable towns. The office market has not been attractive, but this is not like building a (speculative) building and trying to attract 30 tenants."

Blue Cross' Hingham building is in the early stages of the approval process. Plans call for a four-story building of between 300,000 and 400,000 square feet, with a separate parking facility for 1,500 to 2,000 cars. Boston-based George B.H. Macomber Co. is handling the construction.

The site does not have an address yet, and the purchase price on the land was not disclosed.

Margulies & Associates, a Boston-based firm, is designing the interior space for the Hingham building as well as the interior space at 3 Enterprise Drive in Quincy. Previously, it designed Blue Cross' offices at the Landmark Center.

Daniel Perruzzi Jr., a principal at the firm who is heading up the Hingham project, said Blue Cross wants to achieve certification in constructing a "green" building.

The Quincy building will be gutted completely and redesigned, totaling 320,000 square feet in seven stories. In addition, the existing parking garage will be reconstructed to accommodate 1,400 cars.

The Quincy building will also feature some level of green design, said Janet Morra, the Margulies principal heading that project. Dallas-based Turner Construction Co. is doing the demolishing and construction work.

Although Margulies has been working consistently with Blue Cross since designing its Landmark offices, these two projects represent a big boost to the firm. Architects have kept busy during the economic downturn handling office renovations and reconfigurations, but companies have generally reduced spending on office design, and new building construction has been rare.

"It does represent a big chunk of work for us. We will be busy," said Marc Margulies, a principal at the firm. "I can't say that Blue Cross in and of itself represents a trend. But maybe this is an early sign."

Blue Cross has spent the last 2 1/2 years considering its options, Healey said.

"This is a long-term commitment," he said. "It's a confirmation of our desire to be in that area based on the available work force."

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